Global Economic Development Ms. Thompson

Economic Expansion Post WWII The United States helped countries re-build and rebuild their economies after WWII What countries made the most progress: – The U.S. – Western Europe – Japan

Economic Needs Change Manufacturing sped up production Use of machines as labor saving devices changed the way things were produced – Didn’t need as much physical labor – Which technically means less manufacturing jobs Some Industries Prosper: – Information Industries – Computer Industry – Technology Industry These new industries led to “knowledge workers”

“Knowledge Workers” The knowledge workers didn’t have a skill like a physical craft what they had was knowledge of how do accomplish something or the knowledge of how to make components work

Change in terminology We moved away from the old way of classifying countries economically – 1 st world – 2 nd world – 3 rd world New system – Developed nations – Developing nations

Developing Nations Are in the process of industrializing Many workers are eager to engage in manufacturing type jobs Workers are willing to work for significantly less money than in developed nations

Developed Nations Have already industrialized Require better educated workers Expect certain salaries Expect decent working conditions Might have programs that ensure certain wages – Minimum Wage in the U.S.

Global economy Global Economy- Includes ALL financial interactions among people, businesses, and governments—that cross international borders The process of increasing interaction and trade between nations is known as globalization

Multinational Corporations Companies that operate in a number of different countries are known as multinational corporations Many do their manufacturing in some countries, banking in another, and ship components all over the world

Free Trade Free Trade- is the idea that we should work to remove barriers to trade among nations In particular free trade believes that we need to remove tariffs. Tariffs are taxes on goods that are imported. If you remove them more people will by goods from other countries But what does that mean for manufacturers in your country

Pros v. Cons of Tariffs What are the pros of tariffs? What are the cons of tariffs?

Regional Trade Groups The European Union (EU) was created since – 27 member countries – Common Currency the Euro was developed What does a common currency allow the EU to do? What are the Pros and Cons of being on a common currency?

NAFTA North American Free Trade Agreement Signed in 1994 Canada, Mexico, and the U.S. In this agreement the member nations agreed to gradually reduce tariffs and trade restrictions. Fears that it has cost the U.S. jobs

WTO World Trade Organization – “Help trade flow smoothly, freely, fairly, and predictably” – 146 member nations – 30 more trying to join Many criticize the WTO for the impact that they have on workers and the environment

IMF Incredibly controversial International Monetary Fund 184 Countries are members “Promote international monetary cooperation; to foster economic growth and high levels of employment; and provide temporary financial assistance to countries”

G8 Countries: – U.S., – Great Britain, – Italy, – Japan, – German – France – Russia The Great 8 Host annual meetings Sometimes invite the Outreach 5 – Brazil, – People's Republic of China, – India, – Mexico, – and South Africa These countries make up 40% of the GDP in the WORLD!